Former Amaranth Adviser Ready to Try Again

March 23, 2007 ( - The adviser responsible for the collapse of hedge fund manager Amaranth Advisors LLC is launching a new commodities fund.

Reuters reports that Brian Hunter is launching Solengo Capital and offering documents have been received by potential investors. The fund’s prospectus lists two other former Amaranth employees as fund managers for the new portfolio.

Last September, Amaranth lost about $6 billion on Hunter’s bad wagers on natural gas prices (See San Diego Retirement Fund to Feel Hit from Hedge Fund Collapse ). The fund’s collapse was the largest-ever hedge fund failure.

Analysts say private clients may give Hunter another chance, but pension funds and endowments probably will not, according to Reuters. The San Diego County Employees Retirement Association, for one, lost $175 million due to the collapse and had received only a quarter of that loss by January of this year (See San Diego County Fund Gets $48M Repaid in Amaranth Collapse ).

Anonymous hedge fund investors told Reuters Hunter has close to $1 billion in commitments for the new fund already. According to the news report, the prospectus says the fund managers will have freedom to develop business, but if the capital to margin restriction is violated, all capital locks would immediately be voided, “enabling investors to redeem immediately at no cost.”